Markel acquires stake in group that rescued West Broad Village [Richmond Times-Dispatch, Va.]

May 28--Markel Corp. is acquiring a stake in the group that rescued the West Broad Village development in the Short Pump area of western Henrico County.

It is one more addition to the Henrico County-based insurance giant's recently revived private equity investment operation, which in the past several months has snapped up stakes in a pickle-jar-stuffer, a dredge-maker and a company that makes panels and countertops.

"We're gratified that Markel, with its common-sense, long-term investing horizon, thinks our differentiated approach to managing distressed real estate assets fits with them," said Stan Manoogian, one of the principals in E/Class Advisors LLC, which manages the investment fund that owns West Broad Village, among other properties.

Markel's investment in the real estate group comes in two parts.

It is acquiring 50 percent of E/Class Advisors, which will change its name to Markel/Eagle Asset Management LLC.

In addition, Markel will invest in E/Class MB Partners Fund 1, an investment fund that invests in Virginia properties including West Broad Village, a $300 million mixed-use commercial and residential development.

Neither Markel nor E/Class would say how much money is involved.

Markel executives will have two seats on the Markel/Eagle board, while three of the four principals of E/Class will also sit on that board.

"Unlike vulture funds that were created to buy distressed real estate assets on a 'buy low, hold and hope' basis, the Markel/Eagle Asset Management focus is to grow, build and nurture existing properties," Manoogian said yesterday.

Markel President and Chief Investment Officer Thomas S. Gayner said, "We believe Markel/Eagle's hands-on approach to solving complicated real estate issues will yield excellent results."

E/Class completed an $8.9 million investment in West Broad Village in December, rescuing the troubled project.

One of the largest multiuse developments in the Richmond area, the 155-acre West Broad Village houses Whole Foods Market, HomeGoods, Dave & Buster's, Kona Grill and Recreational Equipment Inc.

It also includes town houses and 339 apartments.

Manoogian said that since the investment, his firm has leased or has letters of intent for an additional 80,000 square feet of space, and has rented an additional 126 apartments, meaning that nearly 80 percent of the development's apartments are now occupied. He said the company sold another 62 town house lots and that all the existing homes have now been sold.

"We're still busy out there," he said. "But it's coming along."

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Contact David Ress at (804) 649-6051 or dress @timesdispatch.com.

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